S. Jaykishan

Chartered Accountants

Analysis of Provisions of Finance Bill, 2019

Analysis of Provisions of Finance Bill, 2019

– By Team S. Jaykishan

The Finance Minister Nirmala Sitharaman presented her maiden budget in Modi 2.0 Government in Lok Sabha on July 05, 2019. This Budget has closely watched to understand the Government’s directional framework for the next five years which is guided by the dictum of “blue sky thinking” and making India a $5 trillion economy by 2024-25.

The FM’s speech aimed at Vision for the decade to be achieved by Grameen Bharat (Rural India), Shahree Bharat (Urban India), Nari Tu Narayani (Women), Youth, Ease of Living and India’s Soft Power. The FM has not changed corporate tax rates, the Budget proposes to extend the reduced corporate tax rates of 25% for Indian Companies, whose turnover is less than 400 crores. However, for individuals falling in the rich and super-rich category, a higher surcharge on Income Tax, resulting in the highest effective tax rate of between 38- 42%.

The Budget has tried to address concern, in relation to NBFCs which have been under a lot stress in the past. In order to facilitate securitisation transactions by financially sound NBFCs, with Public Sector Banks, a six-month partial credit guarantee for the first loss up to 10% has been proposed. The requirement to create a Debenture Redemption Reserve for public debt issuance by NBFCs has also been dispensed with.

In this publication, we discuss in detail the tax proposals of the Finance (No.1) Act, 2019 and Finance (No. 2) Bill, 2019 and the recent changes that have come up in the Indirect Taxes. We are grateful for the efforts of the entire team who have helped in bringing out this publication.

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